Exclusive: Pakistan plans takeover of charities run by Islamist figure U.S. has targeted

ISLAMABAD (Reuters) - Pakistan’s government plans to seize control of charities and financial assets linked to Islamist leader Hafiz Saeed, who Washington has designated a terrorist, according to officials and documents reviewed by Reuters.

Pakistan’s civilian government detailed its plans in a secret order to various provincial and federal government departments on Dec. 19, three officials who attended one of several high-level meeting discussing the crackdown told Reuters.

Marked “secret”, a Dec. 19 document from the finance ministry directed law enforcement and governments in Pakistan’s five provinces to submit an action plan by Dec. 28 for a “takeover” of Saeed’s two charities, Jamaat-ud-Dawa (JuD) and the Falah-e-Insaniat Foundation.

The United States has labeled JuD and FIF “terrorist fronts” for Lashkar-e-Taiba (“Army of the Pure” or LeT), a group Saeed founded in 1987 and which Washington and India blame for the 2008 attacks in Mumbai that killed 166 people.

Saeed has repeatedly denied involvement in the Mumbai attacks and a Pakistani court saw insufficient evidence to convict him. The LeT could not be reached for comment.

The Dec. 19 document, which refers to “Financial Action Task Force (FATF) issues”, names only Saeed’s two charities and “actions to be taken” against them.

The FATF, an international body that combats money laundering and terrorist financing, has warned Pakistan it faces inclusion on a watch list for failing to crack down on financing terrorism.

Asked about a crackdown on JuD and FIF, Interior Minister Ahsan Iqbal, who co-chaired one of the meetings on the plan, responded only generally, saying he has ordered authorities “to choke the fundraising of all proscribed outfits in Pakistan”.

In a written reply to Reuters, he also said Pakistan wasn’t taking action under U.S. pressure. “We’re not pleasing anyone. We’re working as a responsible nation to fulfill our obligations to our people and international community.”

In response to the Reuters article, JuD spokesman Yahya Mujahid said the organization will go to court if the government decides to take over JuD and FIF.

“We will not keep silent. We will fight a legal battle,” Mujahid said in statement, terming the government move illegal.

Saeed could not be reached for comment. He has frequently denied having ties to militants and says the charitable organizations he founded and controls have no terrorism ties. He says he promotes an Islamic-oriented government through doing good works.

On Monday, some of the first directives from the proposed crackdown were put in place.

The country’s financial regulator, Securities and Exchange Commission of Pakistan (SECP), issued an order that “prohibits” all companies from donating money to Saeed, LeT, JuD, FiF and other groups and individuals who are named on the U.N. Security Council sanctions lists.

In the capital Islamabad, the district magistrate banned proscribed organizations from “fund-raising in any kind and social, political, welfare and religious activities by these groups”, according to an order reviewed by Reuters.

FILE PHOTO: Hafiz Saeed is showered with flower petals as he walks to court before a Pakistani court ordered his release from house arrest in Lahore, Pakistan November 22, 2017. REUTERS/Mohsin Raza/File Photo

The two-month ban, which can be extended, was put into place “to curb the terrorist acts and assistance activities carried out by the proscribed organizations and their subsidiary welfare wings,” the document said.

FIRST MAJOR MOVE

If the government follows through with the plan, it would mark the first time Pakistan has made a major move against Saeed’s network, which includes 300 seminaries and schools, hospitals, a publishing house and ambulance services. The JuD and FIF alone have about 50,000 volunteers and hundreds of other paid workers, according to two counter-terrorism officials.

Participants at the meeting raised the possibility that the government’s failure to act against the charities could lead to U.N. sanctions, one of the three officials said. A U.N. Security Council team is due to visit Pakistan in late January to review progress against U.N.-designated “terrorist” groups.

FILE PHOTO: Hafiz Saeed (C) reacts to supporters as he walks out of court after a Pakistani court ordered his release from house arrest in Lahore, Pakistan November 22, 2017. REUTERS/Mohsin Raza/File Photo

“Any adverse comments or action suggested by the team can have far-reaching implications for Pakistan,” the official said.

The Dec. 19 document gave few details about how the state would take over Saeed’s charities, pending the plans submitted from the provincial governments. It did say it would involve government entities taking over ambulance services and accounting for other vehicles used by the charities.

It says law enforcement agencies will coordinate with Pakistan’s intelligence agencies to identify the assets of the two charities and examine how they raise money.

The document also directs that the name of JuD’s 200-acre headquarters, Markaz-e-Taiba, near the eastern city of Lahore be changed to something else “to make it known that the Government of “Punjab (province) solely manages and operates the Markaz(headquarters)”.

The move to seize the charities could spark some concern from the powerful military, which has proposed plans to steer Saeed and the JuD into mainstream politics. The military did not respond to a request for comment.

In August, JuD officials formed a new political party, the Milli Muslim League, and backed candidates who fared relatively strongly in two key parliamentary by-elections.

The JuD publicly disavows armed militancy inside Pakistan, but offers vocal support for the cause of rebel fighters in Indian-administered Kashmir and has called for Pakistan to retake Kashmir. Nuclear-armed India and Pakistan have fought two wars over the disputed region.

Washington, which has offered a $10 million reward for information leading to Saeed’s conviction over the Mumbai attacks, warned Islamabad of repercussions after a Pakistani court in late November released him from house arrest.

Punjab’s provincial government had put Saeed under house arrest for 10 months this year for violating anti-terrorism laws.

Writing on Twitter on Monday, U.S. President Donald Trump said the United States has “foolishly” handed Pakistan more than $33 billion in aid over the last 15 years while getting nothing in return and pledged to put a stop to it.